#87 International vs Global
Approximately 2500 years ago, Confucius supposedly said, “When words loose their meaning, people loose their freedom”. What stuck from my early training as a sinologist tells me that this quote has often been misinterpreted and misused. A less common interpretation is that it is important that people who are engaged in discourse must first agree on the terminology before they can have a meaningful exchange of ideas. This is why one of the first things I discuss with students in my International Business course is the sometimes confusing terminology in the field – international, multinational, transnational, global. Depending on the management silo we find ourselves in – strategy, marketing, human resources, etc. – we may use these words differently. Now, I’m not going to go into this discussion here today, but I wanted to share a different, but related observation. Recently I discovered the Google Ngram Viewer (http://books.google.com/ngrams) that provided me with a more historical perspective on the discussion over international business terminology. Ngram mines digital content that Google has stored in GoogleBooks for user-defined key words. Looking for the occurrence of the key words ‘international business’ and ‘global business’ between 1978 and 2008, we can see an interesting development: while the use of “international business” is relatively stable over time (with maybe even a slight decline from 2000 on), we can see dramatic increases in the use of “global business” at least for the 20 years following the mid 1980s.
Looking for an explanation, I turned to the world trade data as provided by the World Trade Organization. I expected to see a dramatic increase in world trade about the same time the use of the term “global business” took off, maybe with some time lag of 3 to 5 years. However, it looks like the most dramatic increases in world (”global”) trade happened only in the late 1990s and not in the 1980s.
I haven’t yet had a chance to look into FDI data (particularly because clean, comparable global FDI data is hard to come by), so therefore, I don’t have a better explanation yet than to just ascribe the heightened popularity of “global business” to a certain trend among authors and publishers. Which remains yet to be proven, of course. Contributions welcome!